Gov't reveals record-breaking consumer price index in Aug.

The Directorate-General of Budget, Accounting and Statistics (DGBAS) yesterday revealed a record-breaking consumer price index (CPI) of 110.74, a 3.42 percent year-on-year increase in August. Food prices soared the most, posting an 8.66-percent increase. This indicates that the average household with NT$60,000 in monthly spending spent an excess NT$2,052 in August, while NT$1,447 more was spent on food.

An official from the DGBAS, Wang Shu-chuan (王淑娟), explained that the typhoons in August contributed significantly to the surge, as well as to electricity and gas price hikes. The food price hikes were the highest since September of 2008.

The top 10 inflated items were all food products. Scallions topped the list with a price increase of 213.5 percent, while bitter melon ranked second with a 100.35-percent increase, and an 84-percent increase for red cabbage.

The DGBAS pointed out that August spending on vegetables increased by NT$828 from the same month in 2011, NT$295 for fruits, and spending on dining out rose by NT$139. Spending on gasoline, electricity and fuel also recorded increases of NT$242, NT$65 and NT$51, respectively, the agency said.

Although people have complained that price hikes have hit almost everything, the agency said the prices of pork and chicken did not increase. Therefore, household spending on meat dropped by NT$45 last month, the DGBAS noted.

Wang reassured that although food prices have risen drastically, prices were likely to sharply decrease. Thus, the DGBAS has forecast a CPI increase of 1.93 percent for the entire year.

Wang explained that economic systems are different in each country, resulting in different changes to CPI. Using Japan as an example, she noted that economic growth was leveled, with no drastic changes in CPI, but this did not mean the overall commodity prices were lower than in Taiwan. "In fact, commodity prices in Japan and the U.S. are all higher than Taiwan," she said.